Automotive supplier optimism grew as 2011 ended


"Levels of optimism increased while pessimism decreased across all company revenue segments" for the month of December, according to the Supplier Sentiment Index released by the Original Equipment Supplier's Assn. The report, released Jan. 16, showed that supplier optimism increased to 66 from a low of 37 in September. Of the 109 respondents, an average of 58% said they were "somewhat more optimistic," up from 25% in November.

Driving that optimism, according to supplier respondent comments, is an increase in vehicle volumes and new projects filling the pipeline. Smaller suppliers ($50-150 million in annual revenue) held a bright outlook with 78% reporting they are "somewhat more optimistic." Sixty percent of respondents from suppliers in the $151 million to $1 billion size range were "somewhat more optimistic."

Production planning volumes are holding steady with a median value of 13.5 million units anticipated for 2012. Regardless of components supplied, companies closely rated the likelihood of occurrence between North American production capacity expansion (rated 3.34) and North American production constraints (rated 3.35). North American capacity rationalization rated 2.79. (A rating of 1 is very unlikely, 3 is neutral and 5 is a very likely scenario.) One of the highest areas in which rationalization seems likely to occur is manufacturing equipment and tooling services. ...
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